New Delhi, August 4
States today rejected a draft Bill on Goods and Services Tax over a clause giving the Centre power to veto their decisions, even as Finance Minister Pranab Mukherjee sought their cooperation for passage of the tax reform.

States feared that giving veto power to the Union Finance Minister on state GST would dilute their fiscal autonomy.

"This proposed draft Constitutional amendment Bill related to GST in its present form is not acceptable to the states... States in general have reservations about the Union Finance Minister having any veto power on state GST," Empowered Committee of state finance ministers Asim Dasgupta told reporters here.

The rejection came within hours of Union Finance Minister Pranab Mukherjee appealing in Parliament to Opposition parties and states for their cooperation to implement GST from next fiscal, saying this indirect-taxes reform measure would help arrest fluctuation in the general price line.

GST will replace the excise duty and service tax at the Central level and value-added tax at the state level, besides the cess, surcharges and local taxes.

Some BJP-ruled states expressed doubts whether at all GST would be introduced from next fiscal.

Dasgupta said states are against infringement on their financial autonomy and have certain reservations on the draft bill's provisions for the GST Council and the GST Disputes Authority.

He said Union Finance Minister, of course, would have an exclusive authority with respect to central GST.

The states also feel that GST Disputes Authority should not find a place in the Constitutional amendment Bill and may be incorporated in GST legislations.

"So, how to handle a situation where state GST and central GST would be there will have to be appropriately and acceptably handled," he said.

In Parliament, Mukherjee said: "The Bill (for constitutional amendments) has to be introduced in this session, has to be examined by the Standing Committee, it has to be ratified by 15 states. Otherwise, there will be another delay ... I seek cooperation of the entire House." Mukherjee said GST would help curb volatility of prices in items and sought the Opposition's help to even include petrol in the proposed GST regime so that its prices do not fluctuate much in the domestic market.

The differences between the Centre and states over GST structure has already delayed its introduction by a year.

Against this financial year, it is now proposed to be introduced from 2011-12. — PTI

New Delhi, August 4
Tata Sons today set up a panel to search for a successor to Group chairman Ratan Tata, who is due to retire in December 2012. The move comes within days of Noel Tata's elevation as head of the $72 billion Group's international operations, strengthening speculation that he would be the successor to his half-brother Ratan Tata, who is credited with taking the Tata name global.

The search committee has five members, including an external member. It was, however, not clear whether who the members were and queries about Ratan Tata himself being part of the search committee yielded no response from the Group's spokesperson.

"The Board of Tata Sons Ltd has formed a selection committee comprising five members, including an external member, for eventually deciding on a suitable successor to Ratan N Tata," Tata Sons, the Group's holding company, said.

Tata, 72, would be hanging his boots in December 2012 when he would turn 75 — the retirement age fixed by the group.

"The selection process for a prospective candidate would consider suitable persons from within the Tata companies and other professionals in India as well as persons overseas with global experience," Tata Sons said. — PTI

Jalandhar, August 4
Farmers of this region will be the main beneficiaries with the opening of Bharti Walmart’s ‘Best Price’ modern wholesale cash-and-carry store, here today. The company had recently set up a collection centre at Banur, near Rajpura, where the farmers get genuine price for their produce.

Rajan Bharti Mittal, chairman, Bharti Walmart, speaking at the inauguration of its third store in Punjab here today, said they were procuring vegetables and fruits directly from the farmers and the response had been very encouraging.

Raj Jain, managing director and CEO of the company, said the farmers supplying their produce to the company get more premium over the mandi rates as they had opted for minimal use of fertilisers and pesticides.

The company’s strategy of direct procurement helps in offering quality produce to the consumers at competitive prices, Jain said.

“We have initiated a development programme to help farmers grow high-quality vegetables and fruits at each stage of cultivation. The company has also been training farmers on post-harvest technology,” he added.

Mumbai, August 4
Led by frontline IT stocks TCS and Infosys, the Bombay Stock Exchange benchmark Sensex surged by 103 points to a fresh 30-month high today, despite negative cues overseas. The 30-share barometer extended its gains for the third straight session to end higher by 102.61 points, or 0.57 per cent, at 18,217.44, its best close since February, 2008.

Similarly, fag-end demand for blue-chip stocks helped the National Stock Exchange's wide-based 50-share Nifty index add 0.52 per cent to finish at 5,467.85 points.

The session was volatile and the Sensex fluctuated between a high of 18,249.46 level and a low of 18,093.03 points.

Software companies stole the show and were the top gainers in the Sensex pack. With an over 3 per cent rise, the BSE IT Index was the top gainer in the 13 sectoral indices. — PTI

Chandigarh, August 4
With the Reserve Bank of India (RBI) giving its go-ahead for trading in currency options, exporters in the region feel that the move will help them in hedging against currency fluctuations.

The RBI has permitted trading of currency options on spot dollar-rupee rate in currency derivatives segment of the stock exchanges, recognised by the Securities and Exchange Board of India (SEBI). At present, only trading in currency futures is allowed in the country in four currencies against the Indian rupee. Since August 2008, the SEBI has allowed exchanges to introduce currency futures, a derivative contract to buy or sell one currency against other on a specified future date, at a price decided in the contract.

The RBI has now allowed trading in currency options, which is a derivative instrument that gives an owner the right, but not the obligation, to exchange money denominated in one currency into another currency at a pre-agreed exchange rate on a specified date.

Talking to TNS here today, Ashwani Kohli, vice-president, Punjab Chamber of Small Exporters, said the move comes at a time when exporters are losing a lot of money because of fluctuation in the currency market. “Over the past one year, we have been suffering huge losses because of the fall in dollar prices. With trading in currency options now being open, exporters will be able to hold currency and keep it in their EFC accounts. When the dollar prices fall, exporters can buy and when it goes up, exporters will be able to sell these on the exchange,” he said.

Meanwhile, leading bourses are gearing up to start trading in currency options. While the MCX Stock Exchange (MCX-SX) has started mock trading in currency options, two other bourses, the National Stock Exchange (NSE) and the United Stock Exchange (USE), are likely to launch live trading soon. The introduction of options trading is likely to boost currency volumes being traded, as not only the corporates, but also the small and medium enterprises (SMEs) are expected to enter this market in a big way by hedging their forex risk at the minimal cost.

Though the SMEs in the region too have welcomed the move, they have certain apprehensions. SC Ralhan, regional chairman of Engineering Export Promotion Council, said there was risk that this could lead to speculation, wherein the big traders will benefit and the SME sector could be hit hard as dollar prices zoom during trading.

Bangalore, August 4
The Federation of Indian Mineral Industries (FIMI) yesterday threatened to go to the court if the Karnataka government did not withdraw its order of July 28 banning iron ore exports from the minor ports under the jurisdiction of the state government.

“The Karnataka government has no right to trample on the fundamental right of a citizen guaranteed under Article 19 of the Constitution to practise any profession, or to carry on any occupation, trade or business,” FIMI secretary-general R.K. Sharma said.

Taking strong exception to the state government’s purported step to curb illegal mining in the state, Sharma, in a letter to Karnataka Chief Minister B.S. Yeddyurappa, said the July 28 notification to withhold permits to move iron ore for export from the lease hold areas was also unconstitutional and illegal.

“The knee-jerk reaction of the state government brings out its helplessness and its inability to curb illegal mining of iron ore in the state,” Sharma said. Dubbing the twin ban orders irrational, FIMI director David Pichamuthu said the organisation would go to the court if the state government did not withdraw the orders with immediate effect.

He also questioned the powers of the state in issuing the twin notifications and said a major mineral like iron ore and its exports came under the jurisdiction of the federal government.